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GAR 100 - 10th Edition

CMS

06 March 2017

Expanded its presence in Asia with a new office in Hong Kong

People in Who’s Who Legal 1
Pending cases as counsel 126
Value of pending counsel work US$6 billion+
Treaty cases 7
Current arbitrator appointments 72* (of which 38 are as sole or chair)
Lawyers sitting as arbitrator 26

*Excludes maritime cases

Adopting a structure more commonly found in the accounting industry, the CMS network comprises 10 financially independent law and tax firms, each carrying the CMS brand along with their original names – for example, CMS Cameron McKenna in the UK and CMS Hasche Sigle in Germany. The network was established in 1999. 

In 2005, the network made international arbitration one of its cross-organisation practice groups, paving the way for common training of associates and inter-office collaboration on cases. Initially, Guy Pendell in London led the cross-network practice, then Torsten Lörcher in Cologne. In 2014, Dorothee Ruckteschler in Stuttgart took over, leaving Lörcher to focus on his role as head of CMS’s global dispute resolution group.

A star partner in the practice is busy arbitrator Klaus Sachs. Based in Munich, Sachs is a member of the board of the International Council for Commercial Arbitration.

The Geneva arm of the network, CMS von Erlach Poncet, was until recently home to Charles Poncet, one of the arbitrators that handed down a US$50 billion award in favour of Yukos shareholders against Russia in 2014. He left to set up his own practice at the start of 2017.

Network

The international arbitration group spans 33 countries, but the bulk of the team is in the UK, Germany and Switzerland. In September 2016, the network announced the launch of a new office in Hong Kong staffed by international arbitration partner Nicolas Wiegand of CMS Hasche Sigle.

The wider network has 65 offices in 38 countries, and in the past year has launched a new office in Tehran and added firms in Chile, Peru and Colombia. 

Who uses it?

It varies depending on which branch of the network you look at, but CMS’s clients include Xerox, Siemens, Rosneft, Roche and Nokia.

In the energy sector, CMS has featured on the panels of external counsel of Royal Dutch Shell, BG Group and National Grid; and has acted for Spain’s Repsol and its South Korean partners Samsung C&T and SK Innovation in a claim against Algeria’s Sonatrach. 

The network has also acted for Shaher Abdulhak, one of Yemen’s wealthiest individuals, in a dispute with Norway’s DNO over oil production in Iraqi Kurdistan; for Portugal’s Galp Gas Natural in an LNG price review arbitration against a Nigerian company; and for a national transmission operator in an Energy Charter Treaty claim against Spain over the reduction of feed-in-tariffs for solar projects.

Outside the energy sector, the network has represented Poland’s General Directorate of National Roads and Motorways and a former subsidiary of Belgian manufacturer Agfa-Gevaert in a series of linked cases against its parent.

Track record

In 2014, the Warsaw office obtained a positive award for Gdansk Transport Company in a four-year dispute with the Polish government, while CMS Stuttgart won a €61 million post-M&A dispute concerning the client’s alleged failure to disclose a European competition investigation by the European Commission.

CMS Bureau Francis Lefebvre in Algiers acted as co-counsel to Shearman & Sterling in an UNCITRAL dispute between an Algerian state entity and Egypt’s Orascom over mobile phone operator Djezzy, which ended in 2014 when Orascom agreed to transfer a 51% stake in Djezzy to the state entity.

In 2012, a Zurich-led team knocked out the bulk of a US$64 million claim by German and Chinese companies against a Japanese client, Mori Seiki, in a case under the Swiss Rules that also saw the clients counterclaim upheld.

In investment treaty work, CMS secured a win for Romania as co-counsel with Winston & Strawn in a case brought by Greek national Spyridon Roussalis. It also provided local law advice to Russian oil company Tatneft in a claim against Ukraine that led to a US$112 million award in the client’s favour (Cleary Gottlieb Steen & Hamilton was lead counsel).

Another matter saw CMS persuade a Kiev court to enforce an SCC emergency arbitration award requiring Ukraine to suspend a hike in gas royalties pending the outcome of an Energy Charter Treaty claim by London-listed JKX Oil & Gas. The claimant wasn’t as successful in the arbitration, however. 

Recent events

As mentioned, Poncet left the Geneva office to focus on his arbitrator work. Nicolas Wiegand relocated from Munich to lead CMS’s new Hong Kong office. He was joined there by counsel Olga Boltenko, who arrived from Clifford Chance in Singapore and has formerly clerked for prominent arbitrator Neil Kaplan QC. Tilman Niedermaier was promoted to counsel in Munich.

Mexico’s Autobuses de Oriente retained CMS to act in a €42 million investment treaty claim against Portugal over a cancelled deal to privatise part of Lisbon’s public transport system. The firm will appear alongside co-counsel Shearman & Sterling.

An ICC claim that CMS brought against Sonatrach saw a disappointing result in October 2016, with a tribunal rejecting arguments by client Repsol and its partners that the Algerian state entity should reimburse amounts paid under an “exceptional profits” tax.

CMS is also acting in several arbitration-related court proceedings around the world – in one maritime dispute before the English Court of Appeal, it helped Russia’s Rosneft win permission to make submissions in the case even though it is not a party to the arbitration.  

The Swiss Federal Supreme Court upheld an ICC award issued by sole arbitrator Hansjürg Schürmann, of counsel at CMS in Zurich, in favour of German engineering group Bosch. The losing side argued that his independence was compromised because he’d failed to disclose counsel work undertaken for Bosch by CMS in Germany. But the court found that the two arms of the CMS network were legally independent and that no conflict had arisen

CMS also established the World eSports Association – a body that professionalises competitive video gaming – and Benjamin Lissner in Cologne helped draft its inaugural arbitration rules.

Client comment

Alfredo Yañez Matesanz, head of contracts at a subsidiary of Spain’s Iberdrola, says the CMS London construction team obtained a good result on a matter where there was a significant amount of money on the table and an initial risk that an award could only go 100% either way. “I would certainly recommend this team to anyone looking for a top-class arbitration team,” he says. The fees were also reasonable for the services rendered.

Another client tells GAR that it was impressed by the firm’s grip on the proceedings. “CMS completely dominated the case from the beginning and this was particularly apparent in defining the issues. The tribunal performed the examinations, but the lead partner was able to push for certain lines of questioning and get our point across.”

A client in a post-M&A arbitration that it describes as the largest in the company’s history says it was very satisfied with CMS’s performance, singling out partner Guy Pendell and senior associate Louise Boswell for particular praise. “The quality of the work was consistently at a high level.”